"70% stocks"

That might be the traditional wisdom from the last 20 years or so, but it might not be so wise now or for the next (possibly long) while.

There is a slim possibility that buying stocks today is a bad idea, but the "magic" of cost dollar averaging means you don't need to chose when to invest. And the advantage to having 30% in something other than stocks is so you can buy them when the market tanks. If you live to be 90 and start investing at 20 you have 70 years to ride out the swings in the market.

Edit: Ok, post retirement swings can be frightening but diversification and the 30% that's not in stocks should give you 8+ years to ride out most bumps. Anyway, once your nest egg is significantly larger than your draw down it stops being important.

"The costly myth of dollar-cost averaging"

http://moneycentral.msn.com/content/P104966.asp

"When the market is studied over long periods, dollar-cost averaging almost always produces lower returns than investing lump sums in diversified portfolios, and almost never reduces risk meaningfully."

I think the best advice I have heard is to think of stocks as buying companies. On the other hand, if one is putting in X dollars in a stock on a regular schedule, then that person is clearly not thinking strategically about stocks, but just sees the stock as a monthly expense that is better than spending it outright because you'll likely have at least something in the future remaining. This type of logic is used by financial professionals to get you to do business with them.

If you have a lump sum to invest then waiting to invest it to use "cost dollar averaging" is not really a great idea.

However, if you compare your rate of returns over 30 years with the best and worst possible lump sum investments vs your rate of return from consistent inflation adjusted investing over 30 years the peaks and overall risk is far lower and the average expected return is higher.

No approach can consistently beat the market investing lots of money over the long term. But some R/W profiles are better for small investors looking for a safe retirement than others. I would suggest most people start young and aim for a 98% chance to hit 90% of their inflation adjusted salary at 65. Getting there sooner is great, but not getting their at all is really bad so trying to time the market is not helping your odds.

The problem is, to make $120k you typically have to move someplace where rent alone may exceed 20k/year.

That's where roommates / flatmates can really help. Using craigslist you can often find 600 - 700$ a month rooms in areas where a nice one bedroom apartment would cost you 1500+ / month. Now days cervices like Pepod and zipcar can make not owning a car easy to deal with in reasonably urban areas. So a 400$ a month apartment in dumb fuck + a car might be more costly than dealing with a roommate in a "higher cost of living area".